Fitch Places Freeport LNG on Rating Watch Negative

“The primary rating concern for Freeport LNG is that the sole source of revenue is dividends from the three liquefaction plants, owned by three operating companies,” Fitch said in a rating action commentary. 

Pietro Donatello Pitts, Hart Energy
Fitch Places Freeport LNG on Rating Watch Negative

Fitch believes Freeport LNG needs to make use of one of the measures provided under its debt structure to timely make the next two quarterly debt service payments; however, the agency expects the payments to be made. (Source: Hart Energy, Freeport LNG, Shutterstock.com)

Fitch Ratings placed Freeport LNG Investments LLLP on rating watch negative, down from stable, to reflect the credit impact of a recent LNG release and fire at Freeport’s three train, 15 million tonnes per annum liquefaction facility in Quintana Island, Texas.

The Quintana facility is expected to return to partial operations in 90 days and full operations in late 2022, the Houston-based company said last week. Notwithstanding, the recent incident at the facility has only exacerbated tightness in global LNG markets. 

“The primary rating concern for Freeport LNG is that the sole source of revenue is dividends from the three liquefaction plants, owned by three operating companies,” Fitch said June 21 in a rating action commentary. 

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